Friday, October 02, 2009

The Cost of Being Gay

The New York Times has a very interesting analysis on the higher costs gay couples (or unmarried heterosexual couples, in some cases, though they of course have the option to marry) may face for things like health insurance for a partner, having a child, etc. Their calculation for the worst case lifetime loss? Almost half a million dollars! Of course the numbers will vary depending on each individual situation, and same-sex couples fare better on federal income taxes because without their marriages being recognized, they aren't subject to the "marriage penalty."
Here's one example:

Health Insurance

In our worst case, the lower earner’s employer did not provide health insurance and her partner’s employer didn’t cover domestic partners. So the lower earner had to buy coverage on the private market, while the higher-earning partner provided coverage for herself and the two children. All this cost the gay couple $211,993 more than their heterosexual married counterparts, who were able to take advantage of the higher-earner’s family coverage.

In our best case, health coverage cost the gay couple $28,595 more. We assumed both gay partners were eligible for employer-provided coverage. The higher-earner’s employer also provided domestic partner coverage, which covered her partner for the five years she stayed at home. When she returned to work, she used her own employer’s insurance.

Even though the couple paid nearly $29,000 more in premiums than an identical heterosexual married couple, it was cheaper than using domestic partnership coverage throughout because of the onerous tax implications, according to Mr. Williams of the Tax Policy Center. A nondependent partner’s coverage is taxable income, and she can’t use pretax dollars to pay the premiums, according to Todd A. Solomon, a partner in the employee benefits department of McDermott Will & Emery in Chicago.

But as the article points out, it may not always be about the money: the emotional cost of not having one's relationship recognized and validated is something you can't budget for.


Anonymous said...

I'd like to be sympathetic, but I'm not.

I'm single and what this article says to me is that the economic benefits of being married are heavily weighted against the single person, to say the least.

I was particularly galled by the calculation about lost benefits when one member of the couple takes 5 years off to take care of children. This to me, is a luxury that is certainly not universal. Or more poignantly, this represents a failure in policy where child care - no matter what the work-situation of the parents, is not particularly affordable and/or accepted. The economic consequences seem calculated for relatively well-off people living "ideal" i.e. conventional lifestyles ... not the reality for most of us.

I am admittedly, a little skeptical because every place I've ever worked for offered health benefits to domestic partners (I work in the non-profit sector in NYC so it may not be a fair comparison.) Also, isn't this EXACTLY the type of thing that health care reform is supposed to fix. The problem is not marriage, it's health care ...

I'm in favor of gay marriage, but it certainly is not because married people are entitled to enjoy economic benefits that single people are not.

Crystal said...

I never thought of the costs of not being able to get married. Why do our equal rights not apply to everyone? I do not see how a married gay couple is going to effect me in some awful way. I would freak out if someone said I couldn't get married. It boggles my mind that tons of people are forced to put up with that every day...

Anonymous said...

What about the savings enjoyed by not having to pay for divorces? Maybe that offsets the costs. ;-)

Brad Castro said...

"A nondependent partner’s coverage is taxable income, and she can’t use pretax dollars to pay the premiums, according to Todd A. Solomon, a partner in the employee benefits department of McDermott Will & Emery in Chicago."

To me, this is unconstitutional. I know this was a relatively recent IRS ruling, but I would think it could (and should) be challenged in the courts.

Unknown said...

I was on NY Times and when I saw the article I immediately said to myself "thank god, someone finally did a comprehensive article on the cost of discrimination!"

Most times people don't understand heterosexual privilege until they see the real economic consequences of discrimination on the lives of gay individuals. I am glad someone finally did a comprehensive analysis of the topic to show how much it can hurt the wallet. Of course, as the article mentioned the emotional cost would outweight the monetary losses.

Highest CD Rates said...

I think we need to have a similar law for everyone. Discrimination should not be done based on relationship or sexuality. We need one single law for everyone.